The crowd is always wrong at the top or the bottom, have we seen the bottom, hell if i know -g-
Well, like AG says, we're never sure if we're in a bubble until it has burst.
Nor are we ever able to tell a bottom until most of the easy profits have been captured to the upside.
However, I still look at the demographic fundamentals, namely the economic power of the baby boomers socking away all of that money with each pension installment. Until they are scared into believing the world is about to come to and end, I'm not going to bet against them.
Money flow drives the market and the key is to be in front of that money flow, especially during times of market turmoil. People still like stocks, especially tech stocks, because they see that technolgy transforming their lives each and every day.
Now until people can see how gold will impact their lives or their wealth each and every day, I hardly see where it will become the focus of this segment of society. Rather, bonds (inflation adjusted bonds as well) and money markets will be the preferred safe haven.
I still think that inflation adjusted bonds will prove the undoing of the gold standard. In effect, they provide their own check and balance system against reckless money creation, as rates will pay higher and higher returns.
Certainly higher returns than a chunk of yellow metal.
But I've never stated that gold won't once more rise against Fiat currency. It just requires certain circumstances that don't currently exist... like global war, pestilence, hedge fund blow ups, oil embargoes.. ect.
The question people have to ask themselves is how much of their wealth they wish to ultimately hold in gold as the ultimate safe haven. And they have to ask how much they are willing to pay for that "priviledge".
Regards,
Ron |
